SERGEI ZUBOV ON HOW THE DEVELOPMENTS OF 2022 HAVE AFFECTED THE REAL ESTATE MARKET
In 2022, the Russian real estate market has become the most turbulent in the past decade, reports the Profil magazine weekly. Sergei Zubov, Senior Researcher of the Financial Studies Department of the Gaidar Institute said that the main trend of the outgoing year was decreased demand for housing amid appreciation of prices and a pickup in mortgage interest rates.
“The real estate market is looking for equilibrium after unprecedented growth largely substantiated by an artificial reduction in interest rates under preferential mortgage programs and the financial crisis caused by sanctions,” the expert explains.
The Profile magazine notes that the most serious changes took place on the primary housing market, particularly in Moscow. According to analysts’ data, for the first time since 2015 the supply of new housing has largely picked up, while demand shrank. At the same time, in 2022 prices kept growing: in November the average cost of a square meter was equal to Rb418,000. However, the secondary housing market was explicitly affected by the developments related with the political agenda and the economic situation both in Russia and in the world. Early in 2022, the market was very active, but from the end of March buyers started to show less interest. Further, in April, for the first time since 2017, the average price of a square meter on the secondary housing market of “old’ Moscow declined, but it did not save consumer demand.
The rent market usually reacts promptly to any social and economic changes. According to analysts’ data, from January till late in August demand was not high, in September it grew by 35% relative to the indicators of spring and summer, while in December it was 50% lower than in the relative period of the previous year.